Category: Insolvency Law

Court approval of settlements in liquidations

The Supreme Court has confirmed that declarations can be made approving settlement payments and the mere fact that a liquidator has acted on incorrect advice will not preclude a settlement payment being regarded as an expense “properly incurred” for the purposes of s 556(1)(a) of the Corporations Act.

The company will repay the loan when it can afford to! How certain is that?

The Supreme Court of Victoria has dismissed an application by a company to set aside a statutory demand which sought repayment of a loan which was to be repaid “as soon as practicable”. The Court held that the term as to repayment was void for uncertainty, and that the loan was accordingly immediately due and payable from its inception.

Insurers on the hook: High Court holds that insurers of insolvent companies can be joined to proceedings commenced by third parties against those companies

The High Court of Australia has held unanimously[1] that a person who commences proceedings against an insolvent company or a bankrupt individual can join that defendant’s insurer to the proceedings and seek a declaration that the insurer is liable to indemnify the defendant.